Supply chain analytics. What is it and why is it creating a bit of buzz these days?

I’ve been thinking about this because the topic has been coming up with greater frequency lately—in conferences I’ve attended, in press releases from technology providers, and in several proposed articles submitted to Supply Chain Management Review. So in supply chain terms anyway, analytics certainly qualifies as a “Critical (hot) Topic.”

First off, what is supply chain analytics? It’s essentially a subset of the broader business analytics, which is the process of collecting, storing, and analyzing data in a way that enables better business decisions. Supply chain analytics incorporates those same activities, but related specifically to supply chain data and decision making. Essentially, the analytics process enables you to use data in a way that enhances supply chain operations, customer and supplier relationships, and ultimately cost and revenue performance.

Not surprisingly, technology plays a huge role in analytics. Given the myriad data points typically available, even a smaller company would find it difficult to do supply chain analytics with largely manual techniques.

Speaking with Jerry O’Dwyer of Deloitte Consulting recently, he commented on the emergence of what he termed “advanced analytics”—supercharged supply chain analytics, if you will. Advanced analytics involves sometimes millions of data points, he explained, often gathered from multiple locations around the globe. The patterns, trends, and other insights revealed through this analysis aids decision-making across the full supply chain spectrum—plan, source, make, deliver, return.

As to why, supply chain analytics is capturing more attention these days. In O’Dwyer’s view, it’s closely related to the economic upturn that is gradually (albeit sometimes haltingly) returning to most sectors. Companies have maxed out on the cost cutting activities. Now they are thinking about positioning themselves for the growth ahead. So how to make the right decisions in this regard? Supply chain analytics is a big part of the answer.

September 13, 2010

About the Author

Francis J. Quinn

Francis J. Quinn currently serves in the dual capacity of editorial director of Supply Chain Management Review and Editor-at-Large of Logistics Management. Frank has been covering the transportation and logistics scene for close to two decades, having served for many years as editor of Traffic Management Magazine. He also has written a special supplement on logistics for Business Week and was a principal contributor to the book Supply Chain Directions for a New North America, prepared for the Council of Logistics Management by Andersen Consulting. Frank holds an undergraduate degree from Boston College and a masters degree from the University of Missouri School of Journalism. His service experience in the U.S. Army includes tours of duty as a magazine editor in Washington D.C. and a military intelligence officer in Saigon, Vietnam.

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